Unlocking margin potential: aligning mission and mix for retail success

In the ever-evolving world of convenience stores, aligning the mission and mix of the store is essential to unlock margin potential and stay ahead of the competition. By understanding consumers’ diverse shopping trip missions, retailers can optimise their offerings, drive growth and increase sales. 

Take the first step towards retail success and arrange a chat with the AF Blakemore team by completing the form below or clicking the link here. The company can help you learn more about the benefits of its cluster-based approach and how this can revolutionise your convenience store business.

Understanding the 3 Ms: mix, mission and margin

Successful store alignment strategy begins with a deep understanding of the customer base. A detailed knowledge of customer shopping habits enables retailers to segment their stores to reflect the needs of their local communities and cater to different missions, such as grab and eat, tonight’s tea, or store cupboard staples.

This cluster-based approach ensures each store or area serves a unique customer base with distinct missions.

Partnering for success: Ian Lewis’ story

Customer preferences are constantly evolving, making it crucial to adjust the store mix accordingly. Ian Lewis, retail director of Spar Minster Lovell, has experienced remarkable growth by aligning mission and mix with AF Blakemore, his partner of choice. This strategic approach has allowed him to unlock his store’s margin potential and achieve retail success, with a 28% increase in retail sales and a 29.5% increase in margin.

“I joined the family business in 2012 and over the next four years, I began to realise the untapped potential of our store,” says Ian. “Seeking opportunities for growth, I reached out to the AF Blakemore team to discuss possibilities, with a primary focus on renovating the shop floor.

“They reviewed our sales reports and customer preferences and quickly identified a vision for us that went way beyond a new floor. We agreed to a re-fit investment of £170,000 supported by a team that analysed each commodity group, determining which products yielded the highest returns and how much space should be allocated to them.

“At the time, we had 11 metres of grocery space, but they managed to optimise it to just five metres without affecting our sales. Their mission-driven approach, combined with a well-curated product mix, has significantly transformed our business, resulting in remarkable returns on investment time and time again.”

So how did he do it?

Ian’s customer-centric approach enables him to develop a store mix that meets his diverse set of customers’ evolving needs. He has responded to trends such as the decline in tobacco by stocking vaping products and expanded into longer shelf-life categories like frozen foods to provide more affordable options.

He also takes immense pride in his food-to-go range, which includes sandwiches, coffee, breads, pastries and pasties. His offer attracts a high number of familiar customers who make a regular morning stop on their way to work.

By staying abreast of these changes and adjusting his store mix accordingly, Ian has been able to drive profitability and meet the changing needs of his customers.

To do this he has followed various strategies advised by AF Blakemore, including:

• Prioritising profitable categories– categories such as meat, fish, and produce offer higher profit margins and serve as key points of differentiation for convenience stores. Ian recognises the importance of prioritising these categories in his store mix. With the growing trend of ‘little and often’, where customers prefer frequent purchases of fresh ingredients, a well-stocked meat, fish and produce section has significantly enhanced customer loyalty and satisfaction.
• Becoming a destination for meal solutions– to cater to the needs of busy shoppers seeking convenient meal solutions, Ian has transformed his store into a go-to destination. By offering a diverse range of ready-to-eat and easy-to-prepare options, such as pre-packaged meals and quick dinner ingredients, he has not only increased average basket spends but also boosted store profitability. “Our store caters to a diverse customer base. Our morning customers, who make up a significant portion of our clientele, often return later in the day to explore our ‘tea for tonight’ solutions,” says Ian. “Additionally, we attract many tourists staying in Air bnbs looking for breakfast, lunch, and dinner options.”
• Customising the offer for the local community– Ian has embraced the diverse community in Minster Lovell and the surrounding areas. With a wide-ranging customer base that includes tradesmen, office workers, tourists, families and children, he has worked alongside AF Blakemore to curate a tailored product mix. This approach has not only catered to the unique preferences of each segment but also fostered a strong connection and loyalty, turning the store into a popular destination for regular shoppers.
• Achieving success through segmentation–  Ian’s success as a Spar retailer can be attributed to his segmented approach. By understanding the diverse customer base in Minster Lovell and the surrounding areas, he has been able to optimise his product mix, pricing strategy, and promotional activities to maximise customer value while achieving his margin aspirations. The strategic partnership with AF Blakemore has provided him with the necessary tools, support, and resources to effectively implement this approach.
• Embracing disruptors for a competitive advantage–  Embracing disruptor brands enhances store appeal and provides convenience retailers with a competitive edge. This strategy not only attracts customers seeking unique and innovative products but also increases satisfaction among existing customers looking for exciting new offerings. ”Spar was the first convenience retailer to offer Prime [energy drinks] in the UK, so naturally we experienced a high volume of additional footfall as a result,” says Ian. ”Additionally, we saw a lot of parents and younger audiences shopping with us for the first time.”

Recognising the importance of staying ahead in the convenience sector, AF Blakemore proactively seeks out innovative and unique products. Alongside its partners in Spar, it was the first convenience wholesaler to introduce Prime energy drinks to the UK market and has further channel exclusives in the pipeline.

Take the first step towards retail success and arrange a chat with the AF Blakemore team by completing the form below or clicking the link here. The company can help you learn more about the benefits of its cluster-based approach and how this can revolutionise your convenience store business.

Unlock your store’s margins

If you are a convenience store owner seeking to unlock the true potential of your store’s profit margins, partnering with a trusted company like AF Blakemore and aligning your mission and product mix can yield significant rewards. Stores are provided with a core planogram aligned to a pricing strategy that ensures competitiveness on the products that drive footfall while still delivering the store margin requirements.

“They know what they are doing and guided us on what could be achieved,” says Ian. “By working with them and implementing best practices, our store has become one of their flagship locations. They have provided invaluable support, helping us to achieve what they said we could and more.

“As a third-generation retailer, our family has always maintained a strong relationship with AF Blakemore. It’s a family business-to-family business thing. They deliver what they say they will and are true to their word.”

For convenience retailers looking to achieve further growth for their store, consider an approach that understands customers’ shopping missions, adapts your store mix to meet evolving customer needs and embrace disruptive brands. With this strategy, you can differentiate your store and stay ahead of the competition.

Take the first step towards retail success and arrange a chat with the AF Blakemore team by completing the form below or clicking the link here. The company can help you learn more about the benefits of its cluster-based approach and how this can revolutionise your convenience store business.

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